context. i'm from voice of vietnamese americans. i'd like to bring in the picture regional and global community. and of that we have vietnam and asean and japan and south korea and north korea and the whole asia-pacific, everyone. ..

>> for the last two decades has shn that china has no ability to observe the rule of law in many aspects including the ipr, the wto, the manipulation of currency, no reciprocal -- [inaudible] the protection of its own market and many other problems. that's different between communism and democracy. >> thank you very much. >> so i'm asking you -- >> which of us -- >> all of you, how to move toward so that china can observe the rule of law, so we can develop a better trust, and we can have a more stable and peace ful regional and global development especially in the southeast china sea and -- >> ma'am, this is a lot of questions. >> thank you. >> just one, the rule of law. >> thank you. whether china will become a democracy, that reminds me of a book that francisco cook yam ma

wrote -- fukuyama with the end of the cold war. basically, what he said in the book is democracy prevails with the collapse of the former soviet union. but what we saw today was, you know, so many chaos in young democracies like thailand, turkey, ukraine, egypt and the crisis of southern europe, devastating financial meltdown in north america, and if liberty, democracy combines, joins hands with that market, turn the world into endless stories of miracles then how can you explain the magical appeal of democracy for improving the livelihoods of ordinary folks talking smart about democracy. peter? >> yeah. i would come to fukuyama's e defense. i don't think he ever claimed democratization was easy. i don't think he ever claimed

that all of a sudden the entire world would be democratic. i think he simply claimed that there are no ideological challengers to the liberal capitalist system after the end of the cold war. be fascism had failed, and he had argued that communism had failed. and, frankly, i think china is a very large country. it is communist in name, as you pointed out, but i certainly teach my students that china is not communist in any other sense other than in name. it is a one-party tick today to haveship. -- dictatorship. so in that sense until there is an alternative, perhaps a beijing model of one-party dictatorship that has widespread popular appeal, until that's the case, i think fukuyama's still right. >> this man believes what china does is practice communism. >> no. no, i just said it's not

communist. [laughter] >> it's not communist, but i i got the impression -- >> in name only. >> oh, well, your neighbor. >> [inaudible] the rule of law, i think. the first thing the government should do is provide a better and better living conditions for the people. especially for developing countries. china's situation is much more different from the united states and from european countries. the first thing and the first concern of ordinary people is that today we can have a stable life, and tomorrow we can make more money to make, to have a better life. that's the -- for that, rule of law is mainly an instrument, a tool for that purpose. we are a myth that democracy

runs rather good and, of course, we all have a lot of problems i don't need to mention. and the united states, we can see there's some good economical, but there are a lot of bad examples in the world. and those are the people who are live anything those so-called democratic countries. and we've so-called rule of law. lives over ordinary people are poor, and in one want to live there -- leave there including the united states citizens and chinese citizens. so we must take china as a whole and take the history, the current situation into consideration when we try to push china to move to whatever. but the only -- [inaudible] to judge what is good for the people, i think chinese people maybe have a different view or

opinion from americans. >> other questions, please. yes, this gentleman. yeah, with the glasses. >> thank you. my name is -- [inaudible] i'm from china. [inaudible] [laughter] thank you. i want to, those gentlemen from -- [inaudible] the american -- [inaudible]

>> okay, thank you. pop culture. i think human rights, freedom, liberty and also democracy. all of them are the aims of the, you know, if you look the documents over the month -- [inaudible] including some of the articles published by china's government, those are the aims. but maybe, first, we have some different definitions about that. the two countries, we are in two different, you know, developed status. now i don't mean democracy or liberty no matter how you define is bad things. we all looking forward to that, and we hope someday it'll be fulfilled in china. but today, currently, the most top concern or the biggest

concern for us to maintain the stability of the society and the country and to achieve economic development to drag millions or hundreds millions of the people out of poverty, pure poverty. and that's what we are looking for today. and in the future i think united states and the chinese people, we share the same value. thank you. >> right. yes, please. [inaudible conversations] >> i have a question regarding efficient policies. according to professor -- sorry -- i do agree with you that policy in china is pretty dirt from the top-down policy. however, we can actually say that it had dramatic impact on

ours -- [inaudible] so i'm wondering what kind of policy we can consider as good policy in the future, how shall we evaluate our policy? not only for china, but also for the united states with. how shall we balance the inefficiency and the quality of the society? thank you. >> okay, thank you. actually, my colleagues -- [inaudible] for this conference, we complained a lot when we, you know, take the bus from our hotel to brookings about this bad weather. you know, the pollution in beijing and shanghai. some of my friends even -- [inaudible] from the united states to try to clean the air. yeah, that's true. but, i mean, china has a lot of problems, and we are facing a lot of difficulties we need to address. but for such a big country, billions of people, and well,

you know, trying to catch up with those developing countries. and you cannot dream or push china to come up with all the -- [inaudible] that developing countries are enjoying today. so we will, i think the government will face and to deal with those including the pollutions, corruption issues. but i am maybe a little bit more confident than some of my peer, the chinese or maybe american friends, and that is i'm more on the mustic about the -- optimistic about the process of the government once the government decided to do something in china. it will, i think, provide big i were opportunity -- bigger opportunity or to china to fulfill something the central government has decided to do than some other countries.

>> just a few more points to add to what xin says about the sustainable policy. first of all, we these to restructure the economy by turning to domestic -- [inaudible] and the second way more government power should be delegated to ngos and let the market play a decisive role in shaping the interaction between the consumers and perhaps be the demand side. also the social security program would help close the income gap between rich and poor, between the prosperous coastal areas and the developed hinterland of china. you name a lot of policy options on the table for the new generation of chinese leadership when you look at the issue of sustainability, so that's something i would like to add to. other than, i mean, other issues like transparency of a budget,

defense budget, that's something i'm looking forward to you guys to raise so that we can answer -- [laughter] this gentleman, right, in the middle. >> hi, thank you. john x be u with -- [inaudible] i have a question for the two american scholars, i should say young scholars. as we know, napoleon once finish. [inaudible] china as a sleeping lion, but two with days back president xi said now china is peaceful is a peaceful and civilized -- [inaudible] waking up a lion. [laughter] so i just wonder what kind of image of rising china to you china be such kind of lion, or can the dragon that you can save tail or just simple "kung fu panda," something hike that? [laughter] >> no. i think china needs to tell us

what kind of rising country it's going to be. you know, the u.s. is very accustomed to having everyone else in the world be very nervous every time we talk an action and to have to be very transparent and explain our intentions and explain what we're doing very clearly so that we can take actions without creating negative repercussions we may not want. so as china is rising up and becoming no longer a sleeping lion, but an awake one or whatever you want to call immaterial, china -- call it, china is going to have to learn that with great power comes great responsibility. when the lion is next to you and he's awake, you're going to be very nervous unless you're quite sure he's friendly. and it's going to take a lot of work on the chinese side to convey what its intentions are. to convey, for example, to the countries involved in the issues in the south china sea what does china mean? when you have a very powerful military and you're not really clear about what some of your border documents indicate, other

countries are going to be very nervous, and they might react in ways that are not beneficial for anyone. so i think we're all waiting for china to make very clear by its actions what kind of country china's going to be as it becomes a major power. and i certainly hope that it'll be a very responsible one. the u.s. has, tries to do a good job at being a responsible power that conveys its intentions clearly. it's easier for us since we're a democracy, and our fights are pretty public. it's going to be harder for public because of the nature of china's political system. but i really hope the leaders in beijing can be really innovative in solving that challenge. >> i think i'd like to return to where we started off with the question of economic and political development of china and the difficulties americans have had understanding the chinese model of economic development because i actually think this is related to the question of perceptions. i think you're right that

americans assume that liberties cohere. that if you have economic reform, you must have reform. and this is a big reason why americans were so shocked about the events of 1989, and you have this move from panda to dragon. and this is the problem. china is neither a panda, nor a dragon. yet we have this tendency to swing back and forth because china doesn't fit our mental model. its had economic reform but not political reform, and we have a hard time squaring that. so the united states needs to do a better job for sort of seeing china for what it is, which is neither panda, nor dragon, but just another animal out there like we are. on china's side, and this applies to america as well, and this is related to a comment made this morning, the united states and china are as the two biggest powers today, our

citizens tend to take on a surgeon kind of narcissism. so i guess i would also encourage us not to constantly be be asking what do they think of us. [laughter] so questions like this can actually be a little wit dangerous. chinese -- a little bit dangerous. chinese shouldn't care too much whether america thinks it's pan that or dragon, chinese should just be confident that they are china, and i think that would help a lot of things. just like americans should not be overly concerned about what other people think about america. >> my question goes to some of you. you'll take the floor freely. it seems the u.s. has been enslaved by the legacy of cold war if you look at the lingering impact of the five military alliances with japan, south korea, australia, the philippines. and you are held hostage by a third party if you look at the bilateral relationship between

the prc and the u.s. like let's look at -- [inaudible] now, it seems the rise of the right wing in japanese politics has scared policymakers on both sides across the aisle, the u.s. and china. because if they want to develop their strategic deterrence by using plutonium and by lifting the cork in the bottle, getting rid of the u.s./japan security accord, then what would the picture be like? i mean, are you concerned with this sort of security scenario? who will be the first to take my question? >> well, i mean, i'm very concerned about the islands issue. i think the most likely scenario leading to a future u.s./china conflict is not a direct conflict of material interests, actually.

i think if there are trade issues, security issues, the united states and china are likely to find possum outcomes. the real danger is getting sucked into a conflict between china and japan or china and taiwan. so as americans we should care very much about the islands and the taiwan issue. >> what about the issue of women? that has a lot to do with your closest ally in northeast asia, south korea. the president feels very happy about the japanese reluctance to accept the issue of -- [inaudible] for women in the second world war as part of the atrocities of the japanese -- [inaudible] what do you think of the this issue as a woman and as a scholar of international studies? >> i think if you compare the recovery in europe in the aftermath of world war ii versus the recovery and lingering tensions in asia, we can see very clearly that whenever we are open and honest about what happened this history and make

the apologies that need to be made to victimized parties, then both sides are -- can move forward. but when we try to hide or suppress information about what many people know to be true that happened during world war ii, those resentments just linger and fester and resurface again and again. and based on the comparison of the great strides that the european union has made versus the lingering tensions over some of these issues in asia, in my personal opinion, i think the only way really forward is for there to be a much more straightforward acknowledgment that there were comfort women in world war ii and it's something that should be apologized for and that they should be honored as victims of world war ii just as soldiers were fighting on the battlefield. and that openness is going to be very crucial for moving towardsed a new, more balanced -- towards a new, more balanced security arrangement in

asia in the future. >> for the new cycle, the tensions in south china sea, i think chinese have different perceptions for that, and because we though that as chinese we have with always been blamed by united states and its allies for the islands, for example. without the nationalization of the -- [inaudible] we will not have the tension. china has proposed -- [inaudible] and so wait for the next generation and the next and the next generation to resolve it. but look at what japan is doing and after the nationalization of the so-called, of the islands. and what premier abe has said, pay homage to the shrine publicly to hail -- [inaudible] long live the emperor, and some

politicians -- [inaudible] and refuse or even try to revise the statements about the slaves and so forth. that makes china very angry and also very suspicious about the real tension -- intention of japan and also the south china sea. [inaudible] has been adopted in 1947, and i think it's about 35 years before the passage of the -- [inaudible] and also for the philippines who have, you know, raised the lawsuit against china about -- [inaudible] and just look pack into the history -- back into the history. in 1898 the united states and spain signed the paris treaty, and two years later, 1900, u.s. and spain signed the washington

treaty, and 1931, u.s. and fill philippines sign -- [inaudible] and two years later the passage of the philippines constitution, all of those postimportant documents -- most important documents, legal documents, frankly, the island had never been included as a territory of philippines. but after the passage of -- [inaudible] and the different sides realized there are some very rich resources of oil or gas, then -- [inaudible] have become p increased. even though china has a much bigger power, but we haven't taken advantage of our economic and military muscle to, you know, to push too much. but with the new tension concerning -- [inaudible] is because as the president this morning mentioned is because

when there are dozens of fishermen from china, you know, fishing near the scarborough shoal, philippines send a flagship of its navy to try to catch fishermen. and in history hundreds of the chinese fishermen have been killed, injured, tortured or even put into prison by philippine government in the past few decades. that's the fact. maybe we can discuss it. i just provide you, chineser perception -- chinese perception. i'm sure americans and philippines have different perception. that's why we today will fartherrer to discuss -- gather to discuss and we can find out the truth. and so i think maybe the faster way is not to just blame china, the best way is to sit down and according to the proposal of

china, to -- [inaudible] and to make common exploration of resources without, you know, putting the wood into the air, into the fire and make tension to disturb the whole region. >> thank you very much. next question. yes. that lady. >> thank you very much. my name's -- [inaudible] i'm from china's -- [inaudible] needs ya. i would like to ask a question about china's domestic politics, was -- because i think it will be wiewdly acknowledged that the chinese government has achieved a lot in terms of lifting millions of people out of poverty. and as professor xin just said, enjoys kind of performance legitimacy so far, and so far so good. but going forward, how much capable do you think the chinese government will be able to maintain this kind of legitimacy

in light of the new challenges that are rising, for example, environment pollution, corruption and just the sheer fact that society grows increasingly complex and difficult to govern? so how much do you think that's possible? >> well, on the domestic politics, it's not exactly politics. in fact, there are issues about the economics, and now i'd like to have an answer from by chinese colleague about economic policies, whether they can be sustained. and the legitimacy. i mean, that's a very popular word concerning the future of china. [laughter] >> yeah. [speaking chinese]

>> translator: problem with economic restuff, that's the -- restructure, that's the biggest problem for the chinese government. [speaking chinese] >> translator: and the same is true with the u.s. economy. we are -- [inaudible] you ask too much but consuming little. this should be reversed somehow, right? [speaking chinese] >> translator: we are reliant on lab growth for too long, now it's time to reconsider -- [inaudible] by turning to consumers. but for politics, yes. anticorruption campaign by mr. xi jinping, what do you think of the long-term impact on

the future of china? >> actually, i think most of the chinese people agree with that, that the corruption is one of the biggest challenges for president of china. and we all supported such efforts to crush the corruption. i'm really not in a good position to speak about the economic development. but i, pause my expertise is foreign affairs. but just to remind that maybe in the past 30 years i doubt whether there are many people in the world can imagine all, you know, fair to say that china can achieve such an economic boom. but the fact is, we did it. and i also am cautiously

optimistic about the future development of china. and because be we have now, we have a lot of challenges, we agree be, including the culture -- [inaudible] but with the development of the urbanization process. and that means if, it's true, a lot of problems. but if one or two of them will be resolved, then it'll open a new gate for future development of china. difficulties also means opportunities sometimes. thank you. >> thank you very much. time is running out. there are many important issues in this most important about relationships such as the arms sales to taiwan, human rights, climate change, proliferation of weapons of massive destruction, denuclearization in the divided korean peninsula, south china sea, you name it.

it would take hours to address those major concerns. the notion of a g2 might be very interesting and may appear more to the mind and heart of those who do care about the bilateral relationship. but to end, to wrap up this very interesting brainstorming discussion here about 35 years of a bilateral relationship, let me quote one punchline. no one stands taller than those who stand corrected. we all have our mistakes and vulnerabilities. but if we adopt a forward-looking attitude in shaping this important relationship, i think it's not just, it will not just serve the fundamental national interests of the two countries, but to help maintain peace and stability for the rest of the world. i mean, this is very, very meaningful, and this is one of the the major reasons why we are brought here, to discuss issues of common concern. i thank you very much for your attention and time. thank you.

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the david morse lecture series, honors lawyers, public servants and internationalists who have been in active, honoring lawyer, public servant and internationals council member for nearly 30 years. our guest today, why you here, president of the world bank, dr. jim yong kim. he will speak with opening remarks, chat and then have about a half hour of q&a. we will wrap up right on time. thanks so much for coming. dr. kim. >> good morning, everybody. thanks, michelle, and also thanks to our host, the council on foreign relations to i'm very honored to be here giving the david a. morse lecture. i want to talk today about some

fundamental issues in global development and the world bank group's role in helping countries and the private sector meet the greatest challenges in development. you know, for a very long time, the rich have known some extent and certainly too much greater extent in recent years the rich have known how the poor around the world live. but what's new in today's world is that the best kept secret from the poor, namely how the rich live, is now out. through television, the internet, handheld instruments which are rapidly increasing number the poor possess, lifestyles of the rich and the middle class, which earlier had only foggy ideas, or transmitted in full color to their homes every day. and that has made all the difference. the political turbulence we are seeing all the around the world is -- a lot of it is fundamentally rooted in this one new feature of today's world.

the question that nearly able to lives in the developing world is asking themselves, is how can they and their children have the economic opportunities that so many others in the world enjoy? everyone knows how everyone else lives. tom friedman has referred to this as people of the virtual middle-class. last you when a child with president morales to a bolivian village, 14,000 feet above sea level to play soccer of all things, villagers snapped pictures of us on the smart phones upon our arrival. when i visited a neighborhood in india, also the highest number of poor people in states with a population of 200 million people, i found indians watching korean soap operas on their smartphones. it's not a great histor mr. kimt everyone wants more opportunities for themselves, and especially for their children. we lived in an unequal world.

a gap between rich and the poor are as obvious here in washington, d.c. as in any capital in the world. yet those excluded from economic progress remained largely invisible to many of him rich world. in the words of pope francis, quote, homeless people freeze to death on the street is not new, but a drop in the stock market is a tragedy, end quote. while we in the rich world may be blind to the suffering of the poor, the poor throughout the world are very much aware of how the rich live. and they have shown they're willing to take action. we cannot remain voluntarily blind to the impact of economic choices of the poor and envelope or not only because of the moral argument that treating your neighbor with dignity is the right thing to do, but also because of the economic argument that when growth includes women, young people and the poor, we all benefit, and inequality -- creates income losses of 27% in

the middle east and north africa. inclusive growth builds a stronger, more robust social contract between people and their government. this also as we know build stronger economies. if we raise women's employment to the levels of men, for instance, average income would rise by 19% in south asia and 14% in latin america. just a year ago the governors of the world bank group endorsed to new goals for our institution. the first that we will commit our energy to end extreme poverty by 2030, and the second that we work to boost shared prosperity. on extreme poverty, what we mean is people living on less than $1.25 a day. less than the point that many of us into from our pockets each night, yet more than a billion people in the world live on less than that each day. the second goal about shared prosperity of course is a focus

on the income growth of the bottom 40%, but we know that even if countries grow at the same rate as over the last 20 years, if the income distribution remains the same, world poverty will fall to only about 7.7% in 2010 and that's the percentage of all the people in the world, not just the developing world living in poverty, from a rate of 17 points 7%, against the entire globe that are living in extreme poverty in 2010. in the past 20 years the world was able to live roughly 35 million people -- list -- every year. if we're going to reach our goal by ending extreme poverty by 2030 we need to help 50 many people raise themselves out of poverty every year. we also know now that the fundamental problem of the world today affect not millions and billions. nearly 2 billion people lack access to energy, and as the 2.5 going people lack access to financial services.

all 7 billion of us pays an impending disaster from climate change if we do not act today with a plan equal to the challenge. martin luther king once said the arc of the moral universe is law -- long but it bends towards justice. we must ask himself whether we, like dr. king did in his life, ma are doing all we can to forcefully banned the arc of history towards justice, tort helping lift more than a billion people out of the devastation of extreme poverty. i'm not just 21 months into my 10 year president of the world group -- world bank group. i asked myself are we doing enough every single day? three months after i started we defined ourselves as a solutions bank that will marshal evidence and experience will knowledge and apply them to local problems. a year into my job the board endorsed our twin goals, and just six months ago the board endorsed our strategy, aligning our operations to meet the

goals. since then we've made substantial changes and where well underway to become to becoming the solutions bank we envisioned to help clients tackle the toughest challenges to meet the twin goals. i feel very fortunate to work in an institution that has so much intellectual depth, no the 1000 economists and 2000 ph.d's. and those ph.d's have at least 4000 opinions points of view on any given issue on any day. in my time at the world bank group as you can imagine, i've had no shortage of pointed advice from my staff. but their passion and insight remind me on a daily basis that are people care deeply about their mission. we recently took a survey of staff and one result was especially encouraging. 90% said they were proud to work at the world bank group. now our responsibility is to take all that experience, talent and knowledge and make it

user-friendly to any country or company that needs it. we need to work differently in order to reflect one of the indisputable new realities of the world. governments and companies can turn to many places for financing and foreknowledge. our comparative advantage has to be so clear that companies, countries and other partners will seek us out for the best advice and experience available anywhere. we now will work much more cohesively across our institution so that staff and the bank that work in the public sector, and the private sector and staff who provide risk insurance and guarantees will bring the collective expressed together to better serve the client. we've also created what we call global practices which will become communities of experts in 14 there's such as water, health, finance, agriculture and energy. in the next few days we will be announcing most of the heads of these practices. imagine what it would be like if i were naming one of you in the

room as a senior director of our water practice but you would be responsible for designing investments in water and sanitation so that girls, for example, are not locking miles every morning to the nearest river for cooking and cleaning instead of going to school. so if you would have read 200 -- union management team would look across water related projects in the world and deployed the 200 experts to bangladesh, peru, china, for instance. making choices to move holders of particular knowledge for, particular knowledge to address specific problems in a particular country. your task more than anything else would be to deliver solutions. you would be expected to find the best approaches in water and sanitation to of millions lift themselves out of poverty. in my opinion you and your 200 experts would have the best job in the world in your field. our entire leadership of the world bank group including the heads of global practices will

be responsible for spreading knowledge and scaling up successful programs. what we have called at the world bank group a science of delivery. delivery is about ensuring that the intended results reach the intended beneficiaries at one year expected cost. in order to deliver at scale when he to curate knowledge, excel at problem solving, deal with complex systems, address source of goals and measure effectiveness throughout all of the projects that we work on. if we can deliver on our problems, on our promises, we can have a transformational impact in the world. the world's developer needs are outstripped the world bank group's ability to address them. but we can do so much more. in order to meet increased demand that we are expecting as we get better at delivering knowledge and solutions to our clients, we've strengthened our financial capacity to scale of revenue and stretch our capital. i'm pleased to announce today with the support of her board would not have the capacity to

nearly double our annual lending to middle income countries from 15 billion as much as $28 billion a year. this means the world bank lending capacity by the amount of monthly care on our balance sheet will increase by $100 billion in the next decade to roughly $300 billion. this is in addition to the largest replenishment in history of our fund for the poorest with nearly $52 billion in grants and provincial loans that we received just in december. at the same time we are increasing our direct support. we are planning to increase its new guarantees by nearly 50% over the next four years. isc expect to double its portal over the next decade and $90 billion. in 10 years we believe the new commitment and your commitments will increase to $26 billion a year. taken as a whole the world bank group's annual commitment which today is about 45-$50 billion is expected to grow to more than 70 going in the coming years. this increase financial

firepower represents unprecedented growth for the world bank group. we are now in a position to mobilize and leveraged in total hundreds of billions of dollars annually in the years ahead. now as a matter of integrity we need to look inside and identify savings. at almost every large organization can become more efficient, we announced a goal of saving $400 billion in the next three years and in the days ahead we'll get details about the majority of those savings which we will of course reinvest in countries. i believe very strongly that we had to get leaner before we got bigger. so in the coming years what will we be doing? we will follow the evidence and we will be bold. the fact is that two-thirds of the world's extreme poor are concentrated in just five countries, india, china, nigeria, bangladesh and the democratic republic of congo. if you add another five country,

indonesia, pakistan, tanzania, ethiopia and kenya the total gross to 80% of the extreme poor. expect us to focus on these countries. but we will not ignore the others. we will have a strategy that ushers no country is left behind as we move toward the target ending extreme poverty by 2030. so how will we be bold? one example is in china where last week we launched our report with the government on the future of china's cities but this booklet the work of more than 100 world experts that, to make policy decisions that address critical development and urbanization challenges including brain growth, pollution and land rights for farmers. this report will help china shift its focus from the quantity of growth to the quality of growth in order to improve the life of its citizens. we hope that these lessons from china will be beneficial to the cities around the world. a second example is the work on the hydro electric project. two weeks ago our board approved

a $73 million grant to the democratic republic of congo, could be the world's largest, which is the world's largest hydro competence of the world's highest hydro power site could generate 40 gigawatts of power which is equal to half of all the installed capacity of all sub-saharan africa today. moreover, it could potentially prevent the emission of 8 billion tons of carbon over 30 years, if coal was used to generate the same amount of power. we need this power desperately in africa. today the combined energy uses, usage of the billion people live in the entire continent, not just the sub-saharan but the entire continent, equals what belgium offers to its 11 million people. this is a form of energy apartheid that we must tackle if messieurs about helping african countries grow and create opportunities for all africa. a third example of our being

bold is in supporting conditional cash transfer programs. these programs provide monthly payments to poor families if, for example, they send their children to school or go to the doctor for a checkup. the results have been astounding. he for conditional tax transfer programs, school attendance by poor children in parts of cambodia were 60%. today, after the program started, nearly 90% of children attend school. in tanzania, along with the country there's in the united nations, we decided to greatly expand the conditional cash transfer program which was started in 2010, for 20,000 household. by the middle of next year we estimate it will reach 1 million households covering five to six millions of the country's poorest people. this is what we mean by identifying successful programs working with partners and taking transformational solutions to scale. this is the path we're taking our to serve our country's better. the world bank group is committed to working more effective ways with key partners

and stakeholders including those in civil society and the private sector. we need partnerships, strong global institutions, a vibrant private sector and committed political leaders. most important of all we need to unite people around the world in a global movement to end poverty. as a physician and health activist of the health policy maker, i had the privilege to be part of an international hiv/aids movement that emerged in the 1990s. the aids fight is a sort of vast human suffering but it's also one of history's most inspiring example of successful global mobilization to reach a shared goals. when hiv treatment appeared in the late 1990s, organizations reached across borders to build a genuinely global aids movement, commit to making treatment of able to everyone. the 200 fold expansion in access to hp but in developing countries over the last decade is the fruit of this movement. millions of lives have been saved and millions of children still have a mother and a

father. social movements can produce results -- excuse me, social movements can produce results even in the face of problems that appear insurmountable. we need to take the lessons from such efforts and apply them to a movement around today's great challenges. ending poverty, boosting shared prosperity, and ensuring that our economic progress does not irreparably compromised our children's future because of climate change. last fall i had the opportunity to discuss these issues with pope francis. when i described our commitment to build global movement to end poverty by 2030, the pope answered simply, count on me. with leaders like pope francis, a global movement to end poverty in our lifetime is possible. all parts of our global society must unite to translate the vision of a more just, sustainable economy and to the

resident action that will be our legacy to the future. into global institutions, government, companies and commenced around the world, people have begun to work to make this vision real. to all these people, to all of you i say, we stand with you. thank you. [applause] >> inspiring. great to have you. so we just heard a lot about the very locked in what difficult to have and want to drill down on one example. so ultimately the world bank group is a financing mechanism. let's talk about the hydroelectric plant in democratic republic of congo. tell me about the decision-making process there. how did you decide, what is the money used for exactly, et cetera? >> the initial $79 is really for the plant but the numbers and i think this happens to most

people who take a look at the geography, the potential, the numbers. hydroelectric power has been controversial for a very long time but in this particular geographical location, the possibility is that with relatively little environmental damage, damage that is was going to be controllable, with relatively little displacement and you could generate up to 40 gigabytes of installed capacity. that's half of what they have been sub-saharan africa right there. the cost will be 3 cents per kilowatt hour. we probably in washington pay 10, 12 cents a kilowatt hour, and they pay the highest price in africa, 75 cents a kilowatt hour. you look at the country like -- they been going 6% you pay 75 -- >> despite the high cost. >> if you add the cost of transmission, chinese companies tell us they can build transmission lines as far as a couple thousand kilometers for an additional two, 3 cents a

kilowatt hour. we're still talking extremely cheap energy. it was just cheap energy you have to look at it but it's not just that. it's so much cleaner, and so over a 30 year period, the co2 emissions from hydroelectric water that would be a million times less compared 8 billion if you build a coal plant. the issue, and this is what i hear him talking with the leaders in africa, they are saying how do you expect us to reach the aspirations we have for our people, the aspirations that are people have for themselves without energy? some people said you don't need coal, you don't need hydroelectric, you don't need nuclear power. you can use solar and wind. but it's just not possible to look at and faster development now with intermittent power. so the question you have to ask yourself, you know, are you serious about two things? the first is are you serious about working with african

countries and people to help them reach that? and for us the answer is yes. the second question, are you serious about climate change? if you are this is a twofer as we said spent with a kilowatt hour cost you if it were coal because it would be higher. it would actually be higher. >> ultimately what happens when the plant is constructed? how far does the plan go? >> this would be a source of income for the democratic republic of the congo and you have to build the transition -- >> because they would pay for it. >> the oversight an agreement with south africa. south africa is ready, they're beginning to really get serious about tackling to actually pay for the actress to be. now, the thing is in five, 10, 15, 20 years we absolutely know for sure that african is going to need that power. so the question for us is which path should we go down? should they go down this path which would avoid nuclear or coal and provide this kind of

power, in a way that we as clean as you can imagine, or do we go into another direction or do we turn away? for me, what we are saying is look, this is going to be hard. we know this is hard. there is a lot of instability in the region but there are other projects in the world in which we been able to build sort of a government structure around something that is important, the suez canal, other places where we said this particular project that is so important that we are going to protect from the vestiges of local politics. that's not -- >> that's what we do. >> that's not going to be easy. but th the question is if it wee that? and for me something that would provide half the power that sub-saharan africa has now, and potentially take 8 billion -- is important enough to really explore spent this sounds like a no-brainer because it was cheaper than also feel but of other places you don't have that choice. if i go to brazil and people are

angry that the gas prices are higher than they otherwise would be because of ethanol. so where did you manage that balance where the poor in the world want electricity, they want cars and the developed world says, oh, well, it will cause a lot of emissions. how do you balance that? >> we are trying to say there will be different solutions in different areas. are there places where solar and wind pace micro grids in many grids make sense? absolutely. villages in india, villages in africa speak are you willing to fund the coal plants? >> you know, our board has been very clear about this, and that we would only do it in a most special circumstances. so you know there are circumstances out there where there's just no other option. right now we haven't seen any agreements on goal while i been president. but you have to balance the need for power with climate change. so if you look at a coal powered plants that we would potentially consider, kosovo, maybe a few

small ones, the impact on co2 emissions as a whole would be minuscule compared to what's already happening out in the united states and china, everywhere else. would we do with? if it came to the point where there were absolute no other potential choices for building, what would talk about, not in them then i think we would have to consider it. because people have a right to energy spent the world is awash in liquidity right now. there's a lot of cheap money in the world. frontier funds, that's basically means investing in places like africa, bangladesh, et cetera. they're getting investment dollars in the way they had never have before. what is your role? is it to compete with an? is it to coexist with them? do you even have a raw? >> you know, we were just at the g20 meeting. i didn't attend but our chief financial officer attended. for the last three or 4g 20

meetings that topic, every single time was we need more funding for infrastructure in developing countries. the world is awash in liquidity, that's true but it's not going to fund those projects. >> so is your role to go with the private sector will not go? >> what we're trying to do is to go with -- [audio difficulty] >> the official developer assistance, four days is about 125 billion a year. africa alone has up hundred billion a year in extra fracture need. if you look at the berks county, africa of in south africa but if you throw south africa in and look at the brig countries, they have about a trillion dollars a year in infrastructure needs. the foreign assistance is a tiny piece of the. what we now know is that as i said, everybody wants to join the global middle class.

in order to meet those aspirations we are going to have to invest i in infrastructure. there's a way to port assistance or even the bank and 50 billion years going to be able to meet that need. what we really are trying to is structure deals so that we lessen the sense of risk that we make clear what the returns are going to be and then we crowd in as it were private sector funders. right now there are a lot out private equity firms, black rock, others are making investment but what they're telling us is they just don't have the personnel to be able to give them every essence of what the risk is. all over the world who can give you a very, very fine-grained analysis of what risk really is. >> how were you able to double your money capacity? are you getting more money or is the board approving more leverage? >> both. the board is approving more leverage. let me put it this way.

we are not getting capital increase. in other words, we're stretching our balance sheet as much as we possibly can, and we have increased the single bar where limits. some of the biggest countries, india, china, brazil are getting close to the single barber limit. what we've done is extended their limit but in extended we've increased the price. so this is a difficult negotiation but they have agreed to pay a higher price for this extension of the ability to borrow. the interest rates, so it's about -- the other part of it is we have a very, very healthy equity loan, 28%. so the question for us is how low can we go in terms of her equity loan ratio? spent this is the equivalent of an ltd, a mortgage come your way under water. i mean, --

>> also through his talk about 10, 12% equity loan. some of the banks are still leveraged at that number. we are at 20%. we have an extra me healthy balance sheet. the question for us is how low can we go in terms of equity loan ratio? flexible in terms of how low we could go we could increase the volume of our lending. for us it was really a matter of being more creative with the resource we had. >> every dollar you are lending out your penny out 10 times, 12 times? i don't want to put you on the spot. >> so why do we do this? if one of the best aaa credit ratings in the world. ..

something like a like bore plus 50 basis points. >> cheap. >> still really really cheap. we borrow at libor minus 25 basis points, something around that. so the spread are just not that great. we think that with we provide a loan at those rates it is part of the responsibility of those

countries as institution to be bade back. it is bodies minute. >> gentleman right lear in the front. there is microphone coming over. >> i'm very excited to hear about the discussion with regard to inga and the potential, that the world bank sees with regard to inga. has there been a lot of coordination as it relates to the u.s. government and power africa initiative that the u.s. government is taking with regard to leveraging the capability that the bank or power africa on the other side may have as it relates to inga given drc is not one of the country es in power related to after from coo. >> we're in negotiations. i know many people in the u.s. government are very interested in inga. there hasn't been a decision yet whether it would be part of power africa.

it's not as you said. i think the u.s. will be critially important partner not only sense of government participation. there are government that is make the technology we need. this is difficult one. this is going to take, the world bank. we're already working, the first grant that we're making to the dr congo has been matched, not fully but partially matched by the african development bank. world bank, african development bank and probably the government of united states in some form we hope. we're not sure. the government of china has shown great interest in this particular project and, would i like to think of this as a potential, potentially a great opportunity for all these institutions to work together around something that will be so important not only for african people but for the planet. so this is, this is a rare opportunity that we have now and

it, there is no question it is going to be difficult, but if china, the united states, multilateral development banks and usaid and the if we get this group together i think we can make it work. >> here in the front. then we'll move to the middle of the back. >> patty babit with the world resources institute. i'm surprised you didn't address climate change more directly. it is obviously global and a threat multiplier and impacts are greatest on poor and poorest of the poor and i you thought if you could talk about how the bank embraced that set of issues. >> i decided to talk about it so much so i decided not to talk about it so much in this particular speech. when i arrived at the world bank, did i see harold in the crowd? hi, harold. harold was one of our heroes he was right there helping us begin

the fight against hiv/aids. when i came on board i asked the people who are working on climate change, i said, do you have a plan that is equal to the challenge? and they said well, what do you mean? let's take one example. take hiv/aids. when harold was head of nih they mount ad campaign the likes of which we haven't seen before. so we discovered people living with the virus in 1981, right? and nih made massive investments in hiv research. i remember harold, tony fauci was saying there are only two kinds of researchers in the world and people reserving hiv now and people that will be researching hiv in the future. harold moved huge amounts of funding into this particular area. so in hiv we put money into basic science research. we changed the laws so it would be easier to get promising molecules into industry. then we changed the laws around food and drug administration to

get molecules that are promising from industry through the fda more quickly. then people set up clinical trials, a network the likes we never seen before. in 15 years, from '81 to '96. we had a treatment turned one-time, completely unvert sally deadly disease into a chronic condition. i said that is what i mean by a plan. you have the basic science, industry, clinical trials, whatever that would be in terms of a sustainable energy. do you have that all together. the answer i got was a resounding no. there is nothing like that for something that so potentially the most important problem that we as a world have faced. so i kept saying what's the plan, what's the plan? the professor came to see me, the itcc they just launched their report and i asked him the same thing. what is the plan professor? we do 8 billion a year in energy

funding. what do you want me to do? there was no plan. so, i said, here's what i think happens. i think what happens is that when some report comes out, or when some extreme weather event happens, the whole world looks to you guys. david: i want part of that group at that time and they're asking themselves, what are we going to do? you say things like take fewer showers. put solar panels on your roof. they look, oh, this is not such a serious problem after all. that was my reading. so we put our plan together. our plan has five parts. the first there's got to be reliable price on carbon. i don't know how we'll do it. it will be really hard but we have to find a way to put a price on carbon. second we have to remove fuel subsidies. egypt is facing many different problems. one the biggest ones, 8% of gdp goes for subsidies of all sorts, right? they have got to remove fuel subsidies because it is both bad

for the bad for the air and also very bad for government. this is a huge expense. it is politically unpopular to remove them. we want to work with countries to remove fuel subsidies. other three, one, cleaner cities. we work with china, because we think there are tremendous innovations in building cleaner cities just not being used. cities are being built on the basis of sprawl. the lack of planning is causing carbon route put to go up. we know there are fantastic examples of being able to reduce carbon output from cities. new york, for example, is amazing example. bloomberg said we would reduce the carbon footprint by 2030. they will get the job done by 2017. the examples are out there. we have to be an organization that takes great solutions already out there and spreads them around the world. another is, access to finance for sustainable energy.

we do not yet have the kind of access to finance for sustainable energy source that is people need. there's not enough financing to meet the demand for solar and wind, wind energy, for example, in africa. we need to do that. finally there is this thing called climate-smart agriculture. there are some great examples of how individual countries, individual states, individual farmers even, have brought to the table, really innovative ways of not only increasing productivity, but actually putting carbon back into the ground. so i just had a great conversation with bill gates about this issue and he's very interested of course in agriculture and health. he points out that everything you need to do to increase the productivity of small farmers in after frick kay, for example, is exactly same thing you need to do to create more small climate

agriculture. there are at least five things we can do right now. these are all win-win propositions. these are things that i think there is general agreement on. i think most controversial one is the price on carbon, but the other four, boy, i think we generally agree on this. if we could just make those four or five things happen, it's, in my view the beginning of a plan. but the basic point is this, why are we not as serious about climate change as we were about hiv? part of it we had harold and others who led the charge but another part of it is i think, i think we're not yet alive to the science of what the ipcc is telling us. >> as you know, there are criticisms of a lot of people would say mission creep by the world bank. if your mission to a leave eight poverty and you're focused on climate change as we discussed before, sometimes there is a choice to be made between the

two, right? >> sure. we're, as we look at the potential impacts of climate change, for example, one of our, our biggest clients is bangladesh, right? bangladesh, if you look what is happening with even small rise in the oceans and look how much land they're going to lose, this would be the number one poverty issue for them in if you look at the coastal cities. one of the predictions is, if we get to where we think we're going to get in terms of temperature rise and sea rise, bangkok could be underwater by 2030. we feel tackling climate change is critical to tackling extreme poverty. >> is the world bank the best mechanism? >> what i came on board i was hoping they would say, hey, here's the plan. we have a plan. we want to you do this part of it that would have been great. i would have said, great, we have a plan -- >> do you think the world bank can execute on that mission? >> we can scale up climate-smart

agriculture. we can provide better financing for renewable energy. we can definitely help people build cleaner cities. >> even though the solar and wind don't get a lot of investment because it is not possible in a lot of places? >> the profitability is one aspect of it, but the real problem in our understanding that you need long-term financing. it is just very difficult to find long-term financing anywhere in the developing world and, you know, the, the real issue and the reason that so many developing country leaders are so worried, even at times of very low interest rates it was still hard to find long-term financing for things like infrastructure for energy. and now with interest rates going up -- >> it will be harder. >> will it get even harder. that is our role. we always play a counter cyclical role. in this particular case making financings available for those things we both know are good for people and good for the environment. >> let's go to the back there, woman, very back row.

in the purple. >> thank you, it's a real pleasure to have you here. i'm yolanda richardson with the campaign for tobacco-free kids. hoping to bring a greater focus on public health. my question given the bank's focus on top five of india, china and bangladesh, these also happen to be the countries with the greatest number of smokers in the world. the bank has not been enthusiastic supporter of increasing tobacco taxes which has dual function both increasing number of revenue that governments have but also decreasing number of smokers disproportionately poor. is there any chance the bank is willing on board to look at tobacco tax as revenue source and a public fix? >> yes. [laughter] let me answer the question a little bit more fully. so one of the most important

studies has ever been done in the world of health and especially global health just came out recently. larry summers and dean jamison did a review of 20 years of investing in health. they were responsible for the 1993 world development report called, investing in health. they did a 20-year retrospective. some of the findings, and this was not original research. this was looking at the studies that had been done over that 20-year period. some of the findings are really stunning. one was from 2000 to 2011, during that period, they estimated that that 24% of economic growth in that period was related to improved health. and so they made the case that now it's not just a question of investing in health because it's the right thing to do morally or ethically, investing in health

is the right thing to do economically and we've never had that kind of number in the world before. it was a stunning number. in education, just, to give you another example, you know, the oecd puts out something called the program on international student assessment. the scores are testing that is given to 16 yieldings. amazing the better you do on pisa scores the better your economy does. we have evidence that investing in education and investing in health is good for economic growth. we really didn't have those kind of numbers 20 years ago. people like me who are health advocates were using moral argument but now we've got an economic argument. you need to invest in your people. in the study, one of the clearest no-brainers is stopping tobacco use or slowing down tobacco use. this is something we simply have to look at. what we're now trying to look

at, is how can we provide everyone some sort of security in health care? universal health coverage is the language we're using. so we're very involved in that. we've become much more involved since i took over and the way that we work is, show us the evidence and we're going to move in that direction. so i think the most exciting thing for me is that 20 years ago we were arguing from a moral, ethical basis that you should invest in people. now, the evidence has caught up with our ethics and the evidence is clear. investing in people is the smartest thing you can do. every country i go to when i meet with heads of state, maybe my background as a doctor and head of a, of a great institution of higher learning, maybe it is that background. every single one of them asks me two questions. how do i both reduce my expenditures and health in the cities and get coverage out to the people and two, how can i build an educational system that will help us be more competitive

in the future? every country in the world, and i would say every country in the world including this one we're in right now has a problem with these two issues and so because they're so important for economic growth, we're going to be very involved in -- >> will you tell the leaders to raise taxes on cigarettes is what she wants to know? >> look, i have, i have a, i have a very clear opinion, personal opinion on taxes for cigarettes. i think they're a good thing. whether they make sense in any given country, i'm going to make the argument it will make sense in every single country. whether this works economically for them, whether it works for them, i'm not sure. what we can make sure is clear policy recommendations based on evidence. what we have happens, make the recommendations and countries make the choice. it's a loan of a all. when we provide a loan the

countries are in the drivers seat. i will continue to bring evidence to them this is good idea and my hope more countries will adopt them. >> question from new york with the woman with the microphone. go ahead. >> thank you very much, dr. kim. maurice templeton. my question is prompted by this response that you just given to the question about health and education and going back to your opening remarks which were basically focused on the fact that we live in a different age where the poor can, not only the rich can watch the poor but the poor can watch the rich and i view that as a potential for what i would call motivation and i think very much in development work all of us involved in it, know that there are certain countries and certain cultures

which are motivated in a different way than others. you raised some of them like education and health issues. how do you see redirecting the world bank to capitalize and to expand the motivation of the recipient countries to address the issues which your institution is trying to address? >> thanks very much for your question. i see next to you my good friend, is that john rosenwalled? hi, rosie, how are you? here is what we hope to be able to do. what we hope to be able to do is really bring solutions together, bring, bring the kind of approaches to improving educational systems, improving health systems, building better

roads and building more liveable cities and we hope to bring all those paths to countries directly and we hope they will choose the options that make most sense. now we're very unique organization. we're run by 1188 governors and those 188 governors are the ones who determine what most broadly the directions we go. we have ministers of finance. we have some ministers of foreign affairs. we have some ministers of development. so because we are a really collective, it's very difficult for us in management to dictate what any single country does. so the principle is that we provide evidence, we provide financing, we do everything we can to increase as you will say, the motivation of, of the countries to do the right thing but at the end of the day because it is a collective, the countries have to make the decision. this is important because the, one of the great criticisms of the world bank in the past is

that we told countries what to do. in the days of structural adjustment this was the big criticism. we land on the scene. we fly in, you know, to the capital cities and we basically tell country what is to do. we can't and we won't do that anymore. instead what we can do is try to convince through evidence of the so i hope that we can be very influential and the better we get at providing, not just sort of ideas, not sort of what to do, but the better we get at helping people with the how, here is how china solved the problem of irrigation in lowest plateau. here is how a particular region in kenya has, implemented climate-smart agriculture. here is how a particular city put in bus rapid transit and had huge impact not only on carbon emissions but got people moving. here is a toll road in senegal. why don't you consider this. the difference, is we're not

saying why don't you build a toll road, we're saying this works really well and we hope it can work for you and excite the passions and possibility of, of these countries and they will make the right choices of the now i see that you are sitting at a whole dartmouth table. i see brad and fred there. good to see you. >> go to the middle of the room there. woman in the center. she has the blue jacket on there. >> thanks. danielle from the state department. hi, jim. you laid out this broadvision for change for the bank and spoke about at the end the need to bring kind of a global community around that vision, around ending extreme poverty and addressing climate change including business and government. what do you see as the mechanisms to do that? there is discussion of next round of global development

goals in 2015 but it seems that getting such, the kind of world around these goals, particularly such a diverse set of actors you need to change them will be a significant task. any thoughts what it will take? >> well, what i've been saying to our team and what i've been saying now to people who are very close working partners, you know, the people like carter robinson, world wildlife fund and mark of the nature conservancy and fred from the edf we're in conversation with them all time. we're saying absolutely yes, we need a global agreement and the opportunity will come up in paris in 2021 and 2015. what can we do right now to make likelihood of a global agreement and i think what we have to do is take all the things we know we can do right now, things we know we're doing badly right now and begin to tackle those issues so there is momentum leading

into the cop 21. will there be agreement at cop 21? i don't know. i sure hope so. that would be a huge boost forward. what are the promising signs? i think president obama and u.s. have made very strong signals about willingness to move forward. china, despite the fact it is the largest emiter has a huge, huge, hugely ambitious plan for reducing their carbon footprint. of course the european union has always been very focused on, on climate change issues. if those three came forward and led the charge to having an agreement i think we'd have one, right? but still, it's complicated and there are always kinds of complex issues who pays for adaptation, for example, and they're in the middle of the mix. so the most important thing is that any of us who can act right now, who can do things right now, to reduce our carbon footprint we need to do it.

for us it is pretty straightforward. >> go to new york for another question. anybody have a question? well, new york thinks about it we'll go right here to the front >> good morning. my name is bob bustani. i'm now with the department of energy, for six years i ran the private sector arm of the asian development bank. during that period we increased our loan factor 41 times of rock solid transactions. michelle was absolutely right when sheave said the world is awash with money. you're absolutely right there is no long-term capital. seems that the nexus there the reason why money doesn't go to these projects, the reason why the private sector doesn't come to these countries and hence why they're poor because the governance in these countries are so bad. there is no rule of law, no regulatory framework, et cetera. i was a bit disappointed not to

hear you talk about governance because i think that is the key to the whole thing. so my question is, really what is the world bank doing on this vitally-important issue. >> because you acknowledge it is an issue when you tried to isolate the banks, world bank loans to make sure you got paid back. >> bob, you know also that that the quality of governance varies dramatically across continents and across the world. i think that most people would be surprised at how much better governance has gotten in africa, for example, over the last 20 years. if you look at the finances of african countries and you look at their debt to gdp ratios, you look at their fiscal policy, one of the things that happened over a 20-year period is that mainly because they had to, these countries listened to groups like the world bank and imf and others and they really did watch

carefully, i mean they benefited tremendously from debt relief but they also did institute more rational and more evidence-based as it were fiscal policy they really watched their debt-to-gdp ratios. you see a lot of these governments. at least from a financial perspective, have fiscal space they could take on these projects. corruption is a very real issue. we continue to work in places where we know that there's corruption because there is no other group that would do it. for example we work in afghanistan and it's critical that we work in afghanistan. nobody wants to see afghanistan go back to an era before 2001. nobody wants to see that but we also know that there's a lot of corruption there. the best thing we can do, when we go into a particular country, we make it clear we have zero tolerance for corruption. on my first day on the job, my first major decision was whether to stop a bridge project because of evidence of corruption and we did it and we will continue to

do it. so we've got to fight corruption. we've got to do everything we can to try to help specific countries improve on their governance. the good news about the bank, you know this from the asian development bank we have safeguards in place, we do auditing, we're so careful following our money we can at least tell our own governors where our own money is going and it takes a lot to do that. our role is try to influence the government and influence from the way that we can. now are there ways of putting together projects, infrastructure projects in countries like africa even private sector investors would feel comfortable with the risk? we think that is definitely possible and that is frankly our job. >> you would take on the risk? >> we would take on a good chunk of the risk but what we would do, we would provide information and on the ground insight about what the real nature of risk in these countries are.

>> the point of his question, right, judicial reform you don't need to be there anymore because the private sector would go there instead? obviously there is potential to make money, there is demand, there is need, et cetera but if you're fearful you will get ripped off you don't go. >> there are many, many countries in the world that have a lot of work to do in terms of rule of law. there is no question about that. >> do you play a role to influence them on that. >> we don't work on rule of law issues. we're not a political organization. we're prevented from our constitutional being directly involved in politics. on the other hand we have helped countries and we've done it over and over in many different areas, we helped countries get better at, at, being more fair in terms of how it deals with private sector companies. we have our doing business report. we've been working on this for a long time. you know, in countries all over africa the leaders are telling me the same thing. they're saying we understand.

we are not going to develop our country based on aid. we need the private sector. every single african country i go to knows this and they know there are things that they need to do. again i would say that you can not generalize across africa. there are places in africa where governance is very strong. there are places in africa where governance is very weak. even within specific african countries are there are regions where the government is strong and government is weak. that is the information we can bring at the end of the day to private investors. >> what do you ask them that i didn't ask you? >> nobody asked me about ukraine. >> you have a minute to tell us about ukraine. >> well, you know, we're, we met with the prime minister when he was in town and, and it's a very difficult situation. again, part of it is we're not, we're not involved in directly

in the politics of the ukraine. >> you're not invited for governance? >> what? what we they had knew is help in terms of implemented their reforms. so this particular government, passed through its parliament a really ambitious set of reforms that even tackled fuel subsidies. so one of the things we're doing we're trying to help them lessen the blow on the poorest of some of these, of many so of these reforms that we know that they have to take. so we're in active negotiations with them to try to figure out what we can do to provide some sort of funding so that, for example, you know, when and if they remove their fuel subsidies -- >> raise prices on couplers -- consumers today, 44%. >> as they do that they need to protect the poorest. the programs we support in the ukraine are specifically providing direct support for some of the poorest citizens. we're working to try to see how quickly we can move that money.

>> thank you so much. >> thank you. [applause] [inaudible conversations] >> while the u.s. senate will gavel in this morning at 10:00 eastern. senators will continue debating extension of the long-term unemployment insurance benefits. we'll have live coverage on c-span2 starting at 10:00 eastern. the house also meets for legislative work today starting at 2:00 eastern. they will consider the

senate-passed ukraine bill which also contains sanctions against russia. live house coverage on our companion network c-span. a house subcommittee is at the time to hear what the new ceo of general motors and the nation's top auto safety watchdog have to say about a defect in the automaker's small cars linked 13 deaths. national highway "traffic" safety administration chief david freeman and gm ceo, mary barra are looking for questions that they did not recall the vehicles until recently. live coverage at on c-span3 at 2:00 p.m. eastern. >> we have to remember two things i think. first we are there because we were attacked in new york city and 3,000 americans were murdered. that's why we went to afghanistan to get those people who were kill killing us. and second, president obama has said there's a limit to this, within two years, we're not doing it anymore. so i agree with you, julie, at

some point you have to let them do it. but in our, in our first goal, if we get away from the afghans, et cetera and look at what our first goal was, if i had told you or any of the listeners in 2001 that we would not be attacked again in the united states of america for the next decade, you know, none of us would have believed that because at that point al qaeda had more of the advantage. now we really have al qaeda and terrorists definitely on the defensive. and so we can, we can at this point get out most of our forces from afghanistan. so i agree with you, but we've been successful in what we really wanted to do as a country and that is to protect ourselves. >> vietnam vet, assistant defense secretary during the reagan administration, analyst and author, bing west, will take your questions "in depth," live for three hours, sunday on

c-span2's booktv. >> now, michael botticelli, acting to director of the white house's national drug control policy, he addressed lieutenant governors from around the country here in washington, d.c. for a conference and he told them the war on drugs is outdated and he outlined the administration's approach to reducing drug abuse. this is about half an hour. >> good morning. my name is todd lamb, lieutenant governor of oklahoma and chair of the national lieutenant governors association. good morning and thank you all for being here of the we certainly had a very busy first day and a great evening last night. this morning we welcome a very distinguished guest. acting director michael botticelli of the national drug control policy office. too many of your states and territories are phasing a growing tide of opiate overdoses. as leaders we all struggle with public health and safety aspects

of drug use in our various communities. we thank acting director botticelli for making the lieutenant governors one of the first groups he is speaking with in his new role at the helm of this office. we look forward to hearing your thoughts on how to address these issues. please join me in welcoming acting director botticelli. [applause] >> thank you very much. thank you, lieutenant governor, and good morning, everybody. i wish i had control over things like elevators and other things. i think it would make all of our jobs easier if we could control things actually beyond our control but i really want to thank you for having the opportunity to come and talk with you. as the lieutenant governor talked about, i think i have not been in a state or a community over the past time that i've been doing this work that hasn't really been impacted by significant drug-related issues

and you know one of the things that we talked about is, just kind of scratched the surface of any major issue that you have in your state, whether it's child welfare, whether it's medicaid or whether it's your correction cost and you will find a drug issue beneath it. it is a particular issue we all have interest in today. you know, you have a critical role in terms of representing the voice of the people in your state. you help guide legislation and state responses that have an immediate impact on your constituents lives. as state leaders you have the opportunity to help us reform our criminal justice, criminal justice and drug reform policy. i actually have a special appreciation for the work that you do having spent most of my career at the state level. prior to omdcp i worked for the massachusetts public health department as director of substance abuse services. we had a governor interagency

task force on drug abuse actively chaired by our lieutenant governor. we really understood the issues around substance use and he was a critical leader in our state to reduce drug use and its critical consequences in massachusetts. my colleagues and i saw first-hand how the state budget translates into services and how often a bed in a treatment center can make a tremendous difference to an individual and his or her family. how providing treatment helps contain costs in our state. the office of national drug control policy sets the national drug control strategy that recognizes substance abuse as a public hello issue, not solely an issue for law enforcement. in 2010, the nation's drug overdose deaths accounted for more deaths either than homicides or motor vehicle crashes. economic data from the department of justice indicate that illegal drug use alone in our nation was an estimated $193 billion in 2007 alone due

to health care crimes and lost productivity. we all agree that it's time for a new approach and the good news is that we're not entering this task blindly. we have scientific research that informs our decisions at the state, local and federal levels. this research has provided us with the knowledge that addiction is a disease of the brain which can be prevented. successfully, treated and from which people can recover. unfortunately we find ourselves too often locked in this counterproductive debate over two extreme visions of drug policy in america. on one side those insisting an outdated war on drugs law enforcement centric approach. build more prisons, arrest more users. on the other side advocates lobbying for legalization as the silver bullet promise to fill state coffers with increased tax revenue and down play legalizations impact on public health and public safety. the truth is neither of these extremes is guided by experience, compassion and most

important, scientific evidence. expanding real evidence-based drug policy reform is a huge undertaking. i would like to focus on three of the most pressing public health and criminal justice reform issues states are facing. prescription drug abuse, and overdose deaths, criminal justice reform, and treatment for substance abuse disorders. as i mentioned before and all of you know too well the abuse of opioids, have reach ad level of epidemic proportions. drug poisoning deaths driven by prescription opioids surpassed traffic crashes as leading cause of injury death in america. heroin use remains relatively low in the united states compared to other drugs but there is troubling increase in the number of people using heroin. in 2011 the obama administration put forward a comprehensive plan to tackle prescription drugs based on four pillars. one, educating parents, youth,

patients about the dangers of abusing painkillers and most importantly, educating prescribers on appropriate and safe use and storage. monitoring prescription drugs at the state level, disposing of medications properly, and enforcing the law by eliminating pill mills. on the education front federal and non-federal partners have devoted serious resources to educating the public and prescriberses. 49 states adopted prescription drug monitoring programs. data from these programs can help prescribers and pharmacists identify patients who may be at risk for substance abuse disorders. >> better. >> data from these programs can help prescribers, pharmacists he

had e identify patients at risk for substance abuse disorders, overdose or other consequences from misusing prescription opioids of the state regulatory and law enforcement agencies may use this information to identify and prevent unsafe prescribing, doctor-shopping, seeing multiple doctors to obtain prescriptions and other methods of illegally diverting controlled substances. the drug enforcement agency has now hosted seven national drug take-back days providing a no questions asked opportunity for people to get rid of unneeded prescription medication. since the dea began national take-back days, 3.4 million-pound of medication have been removed from circulation. at the federal level we developed resources for prescribers. my office works with the national institute on drug abuse to develop two free, online training tools on safe prescribing for pain and managing pain patient who is abuse prescription medications.

of course these courses eligible for continuing medical education and continuing education credit, provide health care professionals with critical skills to manage high-risk patients and more safely prescribe prescription drugs. these are all steps in the right direction but we are still losing far too many people. an average of about 100 people a day in 2010 died from drug overdoses. unfortunately, recent data also indicate an up tick in the use of heroin, another opioid involved in the significant number of overdoses. we must focus on preventing overdose deaths. as we have done in identifying the warning signs of stroke or heart attack we can help save lives by recognizing the signs and systems of an overdose. education is the first step but we're have reversal drug among people who are likely to encounter overdose victims such as family members and

first-responders. ondcp partnered with law enforcement and other organizations around the country to expand access and training on overdose prevention. american society of anesthesiologists has a overdose resuscitation card? assisting a person suspected of being in a-off dose. those card can bedown lloyded from their website. as we've done identifying warning signs of stroke and heart attack we can help save lives by recognizing the signs of an overdose. know locks son, they it can reverse overdose by opioids. where states the outcomes have been nothing short of miraculous. the police department in quincy, massachusetts has partnered with the state public health department to train and equip police officers to resuscitate overdosed victims during an overdose. since october 2010, officers in quincy, which is a city just

south of boston of only 60,000 residents, have administered noxolone more than 220 times and reversed those events, all of them successful in reducing overdoses. ohio recently start ad similar program establishing a one year pilot program in lorraine county, that allows first-responders to administer naxolone to establish ad administration and training paradigm. look at ohio senate bill 57 to see if this is something that con serve your communities. lorraine officers equipped and train in the use of naxolone already reversed overdoses in their community. in addition to naxolone legislation we encourage you to exam 911 good samaritan or amnesty laws. these laws encourage bystanders witnessing a drug overdose to call 911 by providing limited immunity from criminal charges for drug possession. good samaritan laws take several

forms. however the immunity most often applies to the person who seeks medical aid during an overdose. currently these laws are in effect in 14 states and the district of columbia. in 2013 good samaritan laws were being actively considered by half a dozen state legislatures. at every stage of the criminal justice system we should identify ways to reduce costs and improve efficiency while also keeping our communities safe. right now, there is a state level movement towards just disrye investment, a data driven approach to reduce criminal justice spending and reinvest those savings in strategies that can reduce crime and strengthen our neighborhoods. for instance, in north carolina the justice reinvestment act was signed into law in 2011. the legislation includes several policy options to address the challenges of jail and prison overcrowding and increasing correction costs. among other things, among other things the policy diverts,

non-violent, first-time felony drug offenders from prison to community based programing saving prison beds and tax dollars. another way to reduce prison population and break the cycle of drug use, arrest and incarceration is to connect non-violent drug offenders to sentences and sanctions that don't require a jail cell, through drug courts and programs such as through project hope which uses drug testing an sanctions for individual who violate the terms of their supervision. the most effective approach is to develop a full continuum of interventions that include the appropriate supervision and services at every stage of the criminal justice system. our office is funding an initiative to develop such a model for practitioners. the national association of drug court professionals is leading this project and is working with national criminal justice experts and other organizations on model development, training and technical assistance. our hope is that this model will help and enable jurisdictions to

allocate resources for programs and strategies and reduce recidivism. i encourage you to reach out to nadcp to get information on this initiative. unfortunately even after someone has completed his sentence he is still subject to legal obstacles that make it difficult to successfully reenter the community and maintain recovery from a substance abuse disorder. the presence of a criminal record can make it hard to find a job or find housing. employers may ask questions about criminal records on job application and eliminate applicants based on their criminal history. this has led to a number of ban the box initiatives which remove criminal record questions and check bock boxes from job applications of the these initiatives allow applicants to reach the interview stage and discuss their histories without automatic disqualification. banning the box can allow ex-offenders to get to work faster and start contributing to the local and state economy.

recently, target, the country's second largest retailer announced it would remove criminal record questions from its job applications. ban the box action has been taken in more than 50 jurisdictions and 22 states and district of columbia. in 2013 alone, five states, california, illinois, maryland, minnesota, and rhode island adopted new or revised 9 ban the box policies. in addition to banning the box it would be worthwhile to ensure their state statutes and processes for the collection and release of criminal record information do not hinder a successful transition back to the community. example of alternative approaches including require and employer to provide a job applicant with his or her criminal history prior to asking questions about it. allowing a job applicant to see what non-law enforcement entities have requested criminal history prior to an interview or after a rejection and reducing the waiting period to seal those records. these are a few of the approach that is would provide someone who has done his or her time the

opportunity to start anew. any successful criminal justice program must address the root cause and cycle of drug use arrest and incarceration. substance abuse disorders. the criminal justice system can be a critical intervention point for individuals with substance abuse disorders. prisons and jails provide opportunity for evidence based treatment services including medication assisted treatment to those who are incarcerated and have substance abuse disorders to reduce likelihood of relapse and recidivism. the administration supports the food and drug administration which has approved three medications for treatment of opioid dependence, methadone and naltrexone and several for alcohol abuse disorders. in effort to reduce residism in the united states the administration encourages primary and specialty care providers treating jail and prison populations to provide medication as part of

comprehensive approach to treat illicit and drug use disorders. beyond the criminal justice system field of mental health treatment is on the cusp of a enormous change. of 23.1 million americans who needed treatment for substance abuse disorder in 2012, only 2.5 million actually received the treatment they needed at a specialty facility. this is unacceptable. the affordable care act is the best hope we have to insure that people get the substance abuse treatment they need by requiring insurance companies to cover treatment for addiction just as they would cover it for any other chronic disease. the aca also significantly extends the reach of the parody requirements by making mental health and substance abuse treatment one of the 10 essential benefits health insurers are required to cover. leadership opportunities at the state level include not only insuring that insurance benefits are comprehensive and address the full spectrum of substance abuse treatment from prevention, early intervention, and recovery

support, by also working to make sure that people in your state are enrolled in health care about it march 31st deadline. over five million people have already enrolled through healthcare.gov. of the 41.3 million currently uninsured americans, the majority would be able to fine a plan for $100 a month or less in 2014 under medicaid expansion. as state leaders you have an important role increasing access to affordable health care in your state. to conclude, rethinking drug policy a complicated task. much of the work must be done at the state level and i'm so glad to have the opportunity to share our federal perspective and lear about your challenges and concerns. i look forward to continuing the conversation and working with you to make our country, safer, healthier and more just. thank you. [applause] >> so i think we have a few minutes for questions and

comments. >> lieutenant governor fromished yana. >> good morn. >> we have a lot of rural area and i didn't hear meth. i finish ad 92-down tour in indiana. meth if not the highest one of the top three unique addiction levels comes out of to impact families. can you speak to a national level of any of the effort that you see happening there? >> sure. clearly while prescription drug abuse has been really pervasive we still see pockets of the country, particularly rule areas where meth remains a concern. part of what we've been really trying to do is focus on insuring those funding sources for states that allow flexibility, for states timely meant programs based on their state problems. so, so our job is to look across at the federal budget to look at all funding sources. to make sure states and locals

have the opportunity to focus on issues particular to those communities. one of the programs that our office administers is called the drug-free community support program. and the whole goal of this is to say that one community's drug issues are not the same as every other community's. what it does is provide funding at the local level for community coalitions to look at what is a specific issue in that locality and to provide resources to implement prevention programs that are unique to those communities. weill we're trying to call attention to the widespread issues around prescription drug use issues we understand not every community, the impact is different in many communities and how to insure your state has the flexible funding opportunities to make sure you have resources to address those local problems. >> anybody else? governor treadwell.

>> we have marijuana issue on our ballot in august and can you tell me what federal policy is vis-a-vis states that go this route? >> so the federal administration remains opposed to legalization. as you know the department of justice issued guidance to washington and colorado basically saying that with limited law enforcement resources we're not going to be deploying federal resources to focus on case that is involve people who are using it for personal use. you know, we come at this from a health perspective. really looking at what are the, you know, there are some pretty significant health consequences as it relates to marijuana, particularly as it affects our youth. so if you, we has the federal government and you as state leaders, really have the obligation to create environments, particularly with our youth, that are going to promote opportunities for them to succeed. what we see is, there is a

dramatic decrease in the perception of risk of marijuana use by our youth. and that, has resulted in a significant increase of youth who are using mayor one. it actually exceeds tobacco use for people 12 to 17 years old. mayor one, particularly among youth, has been associated with, particularly those who start with adolescence, lower i.q., lower educational attainment. one in nine people who start using mayor one as a youth become addicted to marijuana. we're trying to come at this not from idealogical perspective but looking at this from a public health perspective. when we see what is happening particularly with youth in our country as it relates to marijuana use as well as significant health consequences and public safety consequences, it's, you know, it's, that is how we come at our issues. one of the things that we're doing is actually working with both colorado and washington as well as our federal partners to

really look at what's the impact of legislation on these laws, particularly in colorado and washington. and monitoring the public health and safety impacts so things like drunk driving, diversion of marijuana from a state where it is legal to another one. looking at treatment admissions. looking at patterns of use. so we're monitoring what is the particular public safety and public health impacts of marijuana in colorado and washington. >> governor rigly. >> director -- [inaudible] first of all, use, doesn't matter what it will be, marijuana, amphetamines, whatever it will be will always be personal use level. no reason to move the marketer wise. how do you distinguish between any other narcotic, i'm encouraged to you to talk about the ill effects ever marijuana. how do you possibly distinguish

between marijuana and any currently illegal substance and say government will not time or effort to impose on states? how do you make the distinction. >> understanding you correctly, i think what we're trying to say with limited federal law enforcement priorities, that going after people who are using marijuana for personal use is not a law enforcement priority. that was the decision of the department of justice. i think what we're trying to say is that from a public health perspective we're not drawing a distinction between marijuana and other drugs. so, so that, and we see, you know, as we've been talking about issues around prescription drugs and heroin, quite honestly if you look at kind of most people's progression around addiction, it often starts with alcohol, tobacco and marijuana at a very young age. we know that, you know, giving legal status to a substance decreases the perception of risk. quite hon festally, one of the issues we see around

prescription drugs. if it is seen as legal, seen as a medicine, seen as safe, then kids perceive it as less harmful. so i think, you know, we're trying to draw a distinction between kind of what is a law enforcement priority versus what is a public health priority. >> major job or challenge by doing that, i mean it is a big deal to a kid whether the federal government, i mean that is what they're hearing. they're not going to enforce this. yet you still couldn't change the drinking law to 20 in any state and lower that and get highway funds. i think the job complicated with -- >> you know, again i think that we come at this from, how do we make sure that local communities and states have resources to implement prevention programs. when you think of prevention programs, you know, while some of them are drug specific, you know giving kid the resiliency skills around substances, you know, transcend what the drug is. so, you know, but with both alcohol, tobacco and other

substances. it is really about ongoing prevention messages to our kid and to our families around those kind of issues. thank you. >> any other questions? governor treadwell. >> we're having hearings around the state before this niche i have in august. would your be interested in participating or reporting on what you found about legalization in other states? >> so, we can have subsequent conversation around those. you know, our office, you know, certainly can provide information in terms of some of the health consequences and some of the health issues. so which can have a conversation in terms of what our role can be. >> is there efforts to, is there a way now for policeman pulling somebody over to understand how stoned they are and how are other states dealing with that?

>> so we were actually have some conversations before this. of the so part of what we've been doing and this has been work that has been funded under the national institute of drug abuse, is actually looking at what are those inpayment levels for drug driving, particularly for marijuana use. we have a lot of scientifically based impairment standard for alcohol. we're doing, national institute of drug abuse has been doing research in terms of what are those threshold levels particularly around marijuana levels that are the threshold for impairment. so, you know, we hope to have some information available through the national institute of drug abuse to provide guidance to states in terms of what should be the threshold level around impairment for drug driving. >> [inaudible] thank you for your time this morning. i know you have a very busy schedule that you have to get to now. i think we've made, we delayed you a little bit. my apologies. please join me, members and guest, thank you the director. >> thank you very